3. By setting up their production plants in India, MNCs such as Ford Motors tap the advantage not only of the large markets that countries such as India provide, but also the lower costs of production. Explain the statement.
4. Why do you think the company wants to develop India as a base for manufacturing car components for its global operations? Discuss the following factors:
(a) cost of labour and other resources in India.
(b) the presence of several local manufacturers who supply auto-parts to Ford Motors
(c) closeness to a large number of buyers in India and China
5. In what ways will the production of cars by Ford Motors in India lead to interlinking of production?
Please find below the solution to the asked query.
3)by setting up their production plants in india , MNCs such as ford motors tap the advantage not only of the large markets that countries such as india provide , but also the lower costs of production. explain the statement ?
4)why do you think the company wants to develop india as a base for manufacturing car components for its global operations? discuss the following factors:
(a) cost of labour and other resources in india.
(b) the presence of several local manufacturers who supply autopartsto ford motors.
(c) closeness to a large no. of buyers in india and china Asked by Gursharan Kaur (Student), on 5/1/15
Sol-The following points may help you:
Any company would want to make India as its base and its choice is determined by the following factors:
a. Availability of cheap labour both skilled and unskilled , due to large population in the country
b. Proximity to market, India certainly has one of the largest consumer market , with high demand for cars.
c. Availability of resources that is raw materials at low price.
d. This helps MNCs to reduce their cost of production and maximise profits.
e. Government policies that suit their interests. Government in India has created SEZ to attract foreign companies, Special Economic Zones has been an initiative on part of our country to create economic zones so as to give impetus to country's economic development by attracting foreign investments, giving them extensive range of incentives and tax exemptions.
f. Policies that allows them to collaborate with local companies, These local manufacturers have also prospered and grown substantially.
h.India and china provide for huge market because of large population and also because both are growing economies.
5)In what ways will the production of cars by ford motors in india lead to interlinking of production?
1) Ford Motors is one of the world’s largest automobile manufacturers with production spread over 26 countries of the world
2) Ford was started in collaboration with Mahindra and Mahindra, and by the year 2004, Ford Motors was selling 27,000 cars in Indian markets while 24,000 cars were exported from India to South Africa, Mexico, and Brazil.3) This production will make India as a supplying base for its plants across the globe.